“Should I buy out my lease?” super-thread

Appreciate the input and sorry if these are stupid questions…

My situation: I’m at the last 3 months of my 2020 Q5 P+ lease. My RV is $30,200, and I have 3 payments left @$700/mo (including tax). Got a payoff quote from AudiFS for $32,200. Low mileage (17k). I’m in CA. I realize if I want to buy & keep, I have to pay sales tax - I’m in CA so that’s 10% - UGH.

Got a CarMax quote for $36,600. I realize I can get other quotes but just trying to understand the basics.

Question 1: can I drive to CarMax, hand them the keys, and walk away with a $4,400 check? Meaning, they pay me the difference between their $36.6k quote and my $32.2k payoff? I don’t have to “buy” the car from Audi and pay 10% sales tax and DMV fees before I “sell” to CarMax?

Question 2: assuming I agree to lease/buy another Audi (not a given by any means), and assuming I’m willing to do some negotiating (several dealers near me in NorCal)… would a dealer give me close to $36.6k on a “trade”? I know enough to negotiate the 2 deals separately, but the question is - will an Audi dealer essentially match CarMax?

Thanks in advance!

Yes. Just make sure what Audi’s policy is on third-party buyouts. It seems they charge a different payouts to third party buyouts:

and:

Maybe they would but in my experience, it is more likely to get better buyout deals going through the online buyers:

I would personally try my luck everywhere.

Good Luck.

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State: CT
I have 3 payments left on my lease(365/month)of 2020 Mazda Miata RF, mileage 17k. Lease residual is 19900. But I’m thinking of using it as a trade in for a few car.
If I buy out ct tax is 6.35% (1263) so total of 21163. Carmax offered me 25k so a new gain of about 3800.
Or can I use it as part of trade in for the new car and if so, how much should I demand from the dealer?

The process would be that simple IF Audi allowed 3rd party buyouts without adjusting the payoff amount.

Rather than the $32k payoff that you or an Audi dealer buy the car for, when CarMax requests the payoff it will come back at $38k so instead of $4k in equity you’re $2k underwater if you want to sell to CarMax. Just spitballing numbers here.

As noted above you just need to get as many quotes as possible, no one can tell you for sure. Shop it at all the online buyers just to get a benchmark, then shop it at any local or online Audi dealers or anyone else for that matter.

All that said, in CA you don’t pay sales tax if you buy and then sell a car within 10 days. So it should be possible to buy it and then flip it quickly without paying sales tax.

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I am returning my BMW X5MC this December, I am planning to keep it, any suggestions on what are the best options to finance it?

As you can see in the below link. Depending on where the car was leased from, Mazda Capital Services and Mazda Financial Services allow third-party buyouts. Which should save you the sales tax:

You have plenty of equity in your car with low mileage, so I would try to get quotes from all of the online vendors and local dealers (Hopefully beat the Carmax numbers). You can cash in on the 5k+ equity. Then try to find a new deal. The trade-in value would not necessarily be higher than the equity cheque you will receive from a third-party buyout. So in many cases, it might be better to just cash in on the equity and negotiate the new lease separately.

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OK I need help as I near the end of my first ever lease.

2021 Toyota Tundra with approx. 27k miles

Disposition date: October 13, 2023

Buyout: $34k (approx - need to recheck papers when I get back to Texas for precise figure)

Monthly payment: $410

GMTV, Carvana etc offer up to $43k.

Leased through US Bank.

I want to keep a truck, had the cash set aside to buy a new truck at the end of this lease, which was an interim stop gap until the new Tundras came out. Don’t like the look of the new Tundras, and prices have gone crazy, so I think I will buy out my current lease and just keep it forever.

When do I start the buyout? Is there any advantage to starting this early, or just wait until nearer the end of the lease? Is there any negotiating with US Bank on the buyout price these days?

Thanks.

  • US Bank doesn’t negotiate at this time unless something is really wrong with the car, you have a Toyota, so dont expect it.
  • I can’t remember, if US Bank buyouts needs the dealer who sold you the car.
  • I believe in TX if you start / end it in Texas you don’t pay any extra sales tax so that’s good for you.

This is my first lease so new to this process. Given the info below my current plan is to buyout my lease and keep the car, since my buyout price is 40-50% less expensive than buying a comparable vehicle, but please advise.

2020 Honda Civic EX-L Hatchback, Gray, ~27k miles, good condition with a few exterior scuffs/curb marks on rims.

  • Lease is with Honda Financial
  • Residual value = $15051, disposition date = May 31 2023
  • Current payoff = $15579
  • No lease extension (yet)
  • Equity- My lease was for 45k miles, so well under that on mileage. Seeing on the order of $20-22k from Carvana/GMTV so roughly $5-7k equity, although the Carmax/Ebay selling price is more like $26-28k.
  1. Go through Honda directly instead of involving a dealer and adding unnecessary fees into the price.

  2. If you’re not using cash, scroll up to the link to the best finance APR page :arrow_up:

  3. Honda-specific forums should have sponsors with good pricing on extended OEM warranty (I believe you would need to buy one before the 3/36 expires if you want one).

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I’m in the same situation except I got my Tundra in 2020 thru US Bank. I was under the impression I could just send a check to US bank and buy it out from them at the end of the term. Hoping that is the case.

I don’t see any compelling reason to start early.

Not if you are writing a check. Loan rates will likely be higher as the year progresses…

Hi all

I have 2020 MDX lease maturing in August. Buyout at lease end is 24,500 meaning my payments for march through July will mostly go into interest. Current buyout is $25,1xx. I want to buy out via cash payment but not sure on how the tax/registration works after the pay off? I’m in NC and would appreciate any helpful info. Carmax is offering me $29k but not sure I like anything in my price range in current market. Thanks in advance.

Lease is with Acura Financial.

I’m not sure I follow. Your lease payments should have the same breakdown between depreciation, interest and tax every single month.

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Hi Hackers,

I have 2019 BMW 530i xDrive that I was leasing until the end of August 2022, and given the market for new leases was horrible, I bought out (and financed) the residual amount. The loan was for $34k and I paid sales tax out of pocket (~$2k). I had service done the next month and ended up needing 3 new tires (~$1,300). I did not buy an extended warranty and now the vehicle warranty is expired, so any issues will be out of pocket. The car is in excellent condition with 33,800 miles on it, always serviced on time at the dealership, garage kept, and no accidents.

Given there’s no more warranty, I figured I’d try to sell it to mitigate potential future repair costs. I got estimates from Carvana, Vroom, Driveway, KBB, Cargurus and various local dealerships. All ranged between $24k - $29k. My payoff is $32,250. Today I got an appraisal at Carmax and they gave me $31k. Given I recently paid $3,300 (sales tax and tires) on the car, do I take another $1,200 loss and sell to Carmax or do I just keep it and take my chances if anything goes wrong with the car? And if I keep it, do I buy an extended warranty in case anything goes wrong, which will set me back $4k (~$130/month)?

Sorry for the long story, but ultimately the question is what are the odds that anything will go wrong with the car and I’ll be even more out of pocket if I don’t buy an extended warranty… vs. losing another $1,200 on the sale to Carmax and just getting rid of it. I’d ultimately then need to figure out another vehicle to lease.

All thoughts and feedback welcome. Thanks!

BMW without a Warranty? Sell it.

I bet you’d be lucky to get $21k in a year.

So ask yourself if $10,000 in depreciation plus interest plus any repair costs is worth it to you.

Only you can answer that question.

If you’re in for the long haul then the sponsors on the various BMW forums should have the best prices on the extended gold or platinum warranty.

Make a back up plan before you sell it not to overpay for your next lease or purchase.